Bombay High Court
The New India Assurance Com. Ltd, Thr Its ... vs Raghupati S/O Kisan Appa Nipane And ... on 26 September, 2025
2025:BHC-NAG:9879
1/11 Judg.fa.209.2010.odt
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
NAGPUR BENCH : NAGPUR
FIRST APPEAL NO. 209 OF 2010
The New India Assurance Company Limited
Walcut Compound, Amravati, through its
Manager. ... APPELLANT
VERSUS
1. Raghupati s/o Kisan Appa Nipane
Aged about : 30 Years, Occupation :
Business; R/o Chincholi Gawali, Taluka -
Morshi, District Amravati.
2. Mukesh s/o Dhanraj Kadam
Aged : Major, Occupation : Driver and
Owner of TATA 407, R/o Walgaon, Taluka
and District Amravati.
3. Devidas s/o Rambhau Fate
Aged about : Major, Occupation : Business,
R/o Walgaon, Taluka and District Amravati. ... RESPONDENTS
Mr. A. W. Paunikar, Advocate for Appellant.
Mr. S. S. Shingane, Advocate for Respondent No.1.
None for the Respondent Nos.2 and 3.
CORAM : PRAVIN S. PATIL, J.
ARGUMENTS HEARD ON : SEPTEMBER 17, 2025.
PRONOUNCED ON : SEPTEMBER 26, 2025.
JUDGMENT
. By this Appeal, the Appellant/Insurance Company challenged the Judgement and Award dated 9/3/2009 passed by the Motor Accident Claims 2/11 Judg.fa.209.2010.odt Tribunal, Amravati in Claim Petition No. 15/2006 on the ground that the Insurance Company is not responsible for payment of compensation amount, as there is a breach of policy. Only owner of vehicle is responsible for payment, as Claimant was the gratuitous passenger in the vehicle involved in the accident.
2. To understand the controversy in the matter, following facts are necessary to be considered :
The Claimant filed the proceeding before the Motor Accident Claims Tribunal, Amravati stating that he was doing milk and dairy business.
On 15/11/2005 at about 6.15 p.m. near Hanuman Mandir on Morshi to Chandur Bazar Road the accident took place. At the time of accident, he was travelling in TATA - 407 Matador/Mini Truck bearing registration No. MH-04/S-5917 from Morshi to Chincholi Gawali. According to him, the accident occurred due to negligent driving of the driver and in that accident he caused injuries to his brain and kidney. As such, he caused 50% disablement and lost his working capacity to the extent of 100% due to the head injury. He further stated that he was Indoor Patient after the accident from 16/11/2005 to 24/11/2005 and incurred expenses of more than Rs.50,000/- towards hospital charges. As such, on this submission he has claimed the total amount 3/11 Judg.fa.209.2010.odt of Rs.8,75,000/-. However, considering the financial constraint, restricted his claim to the tune of Rs.2,00,000/-.
3. At the time of accident, the offending vehicle was insured with the Appellant/Insurance Company, covering the risk of damages sustained to the Claimant in the accident. The Claimant in his application before the Tribunal categorically stated that if the learned Tribunal hold that there was a breach of policy committed by the driver as per the provisions of Motor Vehicles Act, 1988 (for short, 'the Act of 1988') in that event, the order of pay and recover be passed against the Insurance Company in respect of third party risk under Section 149 of the Act of 1988.
4. The Appellant/Insurance Company appeared before the Tribunal and opposed the claim by filing its written statement. According to the Appellant, at the time of accident near about 25 passengers were travelling with the goods vehicle. As such, vehicle was engaged in carrying fare paying passengers with the Goods vehicle. Same amount to breach of terms and conditions of the policy imposed on the owner while issuing policy of the vehicle. On this basis, it is stated that Insurance Company is not responsible to pay the compensation to the Claimant.
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5. In the light of above factual position, the learned Tribunal has recorded the evidence in the matter. On behalf of Claimant, his elder brother namely, Chhatrapati Nipane was entered into witness-box stating that due to accident, Respondent No.1/Claimant has caused permanent deafness and also he is not keeping good health and having several health issues. The said witness had produced on record the Certificate of Disability (Exhibit-53) and established that injured is facing serious health problem and now he is not enjoying the normal life due to injuries caused to him in the accident.
6. On behalf of Appellant/Insurance Company, Ms. Shalini Krushna, the Assistant Manager of the Company entered into the witness-box and stated that as many persons were travelling in the offending vehicle, there is a violation of policy, and hence, the Insurance Company is not responsible for payment of compensation.
7. In the light of above evidence before the Tribunal, the Tribunal held that due to negligence of the driver of the offending vehicle, the accident had taken place. The learned Tribunal has relied upon the Judgment of Oriental Insurance Company Ltd. V/s Rashanna, 2007 (3) TAC 385 Bombay to hold that it is the responsibility of the Insurance Company to bring on record that there is a violation of the terms and conditions of the policy. However, 5/11 Judg.fa.209.2010.odt from the evidence, which has come on record by the Appellant, it is only stated that as number of passengers were carrying on payment of fare in the offending vehicle, same amount to breach of policy. It is also stated that one Wamanrao Jichkar has lodged the First Information Report about the accident and FIR registered in the matter fortify their submission. But, no efforts were taken to lead evidence of any of the surviving person in the matter, to establish the fact that passengers were travelling on payment of fare in the vehicle.
8. The learned Tribunal further relied upon the Judgment in the case of United India Insurance Company Ltd. V/s Suresh K. K. and others, 2008 ACJ 1741 SC, wherein it is held that if the owner of the vehicle is not aware and without his consent the driver has rented the vehicle, in that case, it cannot be held that there is a violation of the terms of policy. Hence, by recording these reasons held that Insurance Company cannot be exonerated from the payment of compensation in the matter.
9. The learned Counsel appearing for the Claimant i.e. Respondent No.1 states that in the entire episode he was not responsible for the accident and due to negligence of the driver of offending vehicle, the accident took place and caused permanent disability to the Claimant. Therefore, the amount 6/11 Judg.fa.209.2010.odt awarded by the learned Tribunal shall be paid, either by the Appellant/Insurance Company or by the owner of the vehicle.
10. I have heard learned Counsel for both sides at length and gone through the entire record as well as the case laws relied upon by the parties.
11. The Appellant has strongly relied upon the Judgment of the Hon'ble Supreme Court in the case of National Insurance Company Ltd. V/s Bommithi Subbhayamma and others, (2005) 12 Supreme Court Cases 243, particularly to the paragraph Nos.6 and 7, wherein the Hon'ble Supreme Court has held that the statutory liability of Insurance Company does not cover gratuitous passenger carried in a goods vehicle. The relevant portion of paragraph Nos.6 and 7 of this Judgment read as under :
"6. The learned Counsel appearing for the Appellant submitted that in view of the fact that the decision of this Court in Asha Rani the impugned Judgment cannot be sustained. The learned Counsel appears to be correct.
7. In Asha Rani this Court while overruling Satpal Singh has clearly held that the Insurance Company is not liable for payment of any compensation for death of a gratuitous passenger travelling in a goods vehicle."
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12. The Appellant has further relied upon the Judgment of the Hon'ble Supreme Court in the case of National Insurance Company Limited V/s Rattani and Others (2009) 2 Supreme Court Cases 75 , wherein the Hon'ble Supreme Court in its extraordinary jurisdiction has looked into the contents of FIR to appreciate the evidence. As such, it is the submission of the Appellant that in the present Appeal also the contents of FIR can be looked into, whereby it will be clear that the Claimant was a gratuitous passenger.
Hence, it is the submission of the learned Counsel for Appellant that Insurance Company is to be exonerated from the payment of compensation.
13. The learned Counsel appearing for the Appellant has placed reliance upon the Judgment of the Hon'ble Supreme Court in the case of Manuara Khatun and Others V/s Rajesh Kumar Singh and others along with connected Appeals, 2017(4) Supreme Court Cases 796 , wherein the Hon'ble Supreme Court has held in paragraph No. 21 as under :
"21. In view of the foregoing discussion, we are of the view that the direction to United India Insurance Company Ltd. (Respondent No.3) - they being the insurer of the offending vehicle which was found involved in causing accident due to negligence of its driver needs to be issued directing them (United India Insurance Company Ltd. Respondent No.3) to first pay the awarded sum to the appellants (claimants) and then to recover the paid awarded sum from the owner of the offending vehicle (TATA Sumo) Respondent 1 8/11 Judg.fa.209.2010.odt in execution proceedings arising in this very case as per the law laid down in para 26 of Saju P. Paul case quoted supra."
The learned Counsel further referred the Judgment of Hon'ble Supreme Court in the case of Rani and Others V/s National Insurance Company Limited (2018) 8 supreme Court Cases 492, wherein in paragraph Nos.16 and 17, the Hon'ble Supreme Court has observed as under :
"16. Reverting to the appeal preferred by Respondent 1 Insurance Company against Anand (MFA No. 5876 of 2011), as noted in paras 11 and 12 of the impugned Judgment reproduced above, the High Court disposed of the said appeal by absolving the insurer from the liability to pay compensation amount. As noticed earlier, the appellant (Anand) did not file any appeal against the award passed by the Tribunal for enhancement of compensation amount and the cross-objection filed by him in the appeal filed by the insurance Company came to be dismissed for non-prosecution. Even in respect of this appeal, the Tribunal had found that he failed to produce any evidence regarding his monthly income and the permanent disability suffered by him had been determined as not exceeding 10% to the whole body and compensation had been awarded to him on that basis. Resultantly, we intend to dispose of this appeal on the same basis by directing Respondent 1 Insurance Company to pay the compensation amount awarded to the claimant (Anand) in the first place, with liberty to recover the same from the owner of the offending vehicle (Respondent 2).
17. In view of the above, the appeals are partly allowed by directing Respondent 1 Insurance Company to first pay the compensation amount to the respective claimants as determined by 9/11 Judg.fa.209.2010.odt the High Court and Tribunal as the case may be, with liberty to recover the same from the owner of the offending vehicle, Respondent 2. The impugned judgment and order passed by the High Court stands modified to this limited extent."
The Appellant has then relied upon the Judgment of the Hon'ble Supreme Court in the case of Anu Bhanvara V/s Iffco Tokio General Insurance Company Limited and Others, 2020(20) SCC 632 , wherein in paragraph No.9 the Hon'ble Supreme Court has observed as under :
"9. The next question is as to which of the respondents, that is the owner and driver, or the insurer of the vehicle, would be liable for payment of such compensation. As regard the liability for payment of compensation, it has been contended by the learned counsel for the appellants that since the vehicle was admittedly insured with the respondent no.1-insurance company, the principle of pay and recover would be invoked even in case of a gratuitous passenger in a goods vehicle. The insurance company should thus be made liable for the payment of compensation to the appellants and in turn they would have the right to realise/recover the same from the owner and driver of the vehicle"
From the abovesaid legal position, which is pointed out by both the Counsels, I am of the opinion that the Hon'ble Supreme Court consistently held that even in a case of gratuitous passenger, pay and recover principle can be made applicable in the matter. Therefore, the said principle can be applied in the present case also.
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14. Here in the present case, it is the case of Appellant that Respondent No.1 was a gratuitous passenger, and therefore, considering this fact, the Respondent No.1 is entitled to recover the amount from the Insurance Company.
15. It will be expedient to lay down the principle of law by the Hon'ble Supreme Court of India in the case of National Insurance Company Ltd. V/s Swaran Singh & Others 2004(5) Bom.C.R. 467 , wherein the Hon'ble Supreme Court has held that the doctrine of "stare decisis" is required to be followed in the matter, because in the case of compensation, different views can create controversy in the matter, particularly, in the case of compensation. In the circumstances, I proceed to pass the following order.
ORDER
1. The Judgement and order dated 9/3/2009 passed by the Motor Accident Claims Tribunal, Amravati in Claim Petition No. 15/2006 is modified to the extent that the Appellant/Insurance Company shall pay the compensation awarded by the Tribunal to the Respondent No.1.
2. The Respondent No.1 is permitted to withdraw the amount deposited by the Appellant before this Court along with interest accrued thereon, subject to the satisfaction of Registrar (Judicial).
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3. The Appellant/Insurance Company is at liberty to recover the compensation amount from the Respondent No.2/Owner of the offending vehicle.
4. Rest of the order passed by the learned Tribunal is confirmed.
5. First Appeal is disposed of in above terms. No order as to costs.
16. Since the First Appeal is disposed of, pending Civil Application (CAF) No. 611/2010 does not survive. The same stands disposed of accordingly.
[PRAVIN S. PATIL, J.] vijaya Signed by: Mrs. V.G. Yadav Designation: PS To Honourable Judge Date: 29/09/2025 11:56:04